Ethereum, the second biggest cryptocurrency after Bitcoin, was proposed in 2013 by Vitalik Buterin. Like other cryptocurrencies, Ethereum is also an application of blockchain technology.
It operates on a decentralized platform; it is open-source distributed computing platform which features smart contract functionality.
It allows developers to build decentralized applications and deploy them. In 2016, after the DAO collapse, a radical change (hard fork) was made to the Ethereum market, in which Ethereum was split into Ethereum (based on original blockchain) and Ethereum Classic (based on hard forked protocol).
Difference Between Bitcoin and Ethereum
Bitcoin offers peer to peer electronic cash system enabling online Bitcoin payments.
Ethereum is focused on programming code for decentralized applications.
The token of earning provided to miners in Bitcoin is a Bitcoin itself while in Ethereum, the token is called Ether.
Like Bitcoin, Ethereum is a tradable cryptocurrency and it is also used by developers to pay for transaction fees and services on its network.
Ethereum Smart Contract Functionality
Smart contract is a computer code which facilitates the exchange of content, money, property, shares and other things that have a value associated with them.
Smart contract executes automatically as per the defined standards.
It gets triggered at events such as expiry date of a contract between two parties, rise in prices, etc. A person without a technical background of writing code can also build smart contracts.
EVM (Ethereum Virtual Machine)
It is one of the vital innovations of Ethereum.
This Turing complete software enables anyone to run any program and in any programming language. EVM is completely isolated from the rest of the main Ethereum network, hence it becomes easy for developers to test their codes and at the same time does not affect on-going blockchain operations.
Thus, EVM provides sandbox environments for smart contract development.
Benefits of decentralized platform
- Security: Secured using cryptography, ethereum applications are protected against fraudulent attacks
- Immutable: No third party can change smart contracts code
- Zero downtime: Applications never go down or are never switched off from running
- Corruption proof: Censorship of applications is almost impossible
Applications of Ethereum
Any centralized service can be decentralized with the help of Ethereum, be it voting systems controlled by government, loans provided by banks, and many others.
Decentralized applications of Ethereum are often called “dapps”. Following list gives a comprehensive idea of the application of dapps in different sectors:
- Health: Better storage and access facility for patient’s records across multiple locations. The data available with different doctors for same patient will remain same.
- Politics: Ethereum will ensure a transparent voting system as every change can be logged in the network and can be made publicly visible
- Self-driving cars: Ethereum will enable seamless communication between connected cars
- Crowdfunding: Smart contracts used to make donation agreement across a wide range of investors
- Art: Rewards in the form of ethers can be provided to artists and hence they can be recognized on a larger public platform provided by Ethereum
Ethereum can be accessed using Mist browser.
Mist can be used to write smart contracts and also for initiating any kind of ether payments. MetaMask, a browser extension, turns Google Chrome into an Ethereum browser.
Dapps can easily be run on this browser.
ETH price in INR is about Rs 77,000.
|Circulating Supply||96,872,550 ETH|
|% Change (in last 1 year)||11.60k%|
Available Dapps on Ethereum Network
- Weifund: Platform for crowdfunding campaigns. Digital assets can be used, traded or sold within the network
- Uport: Keep the personal information secure and in control of self. KYC information can be kept intact using this dapp
- BlockApps: Build, manage and deploy blockchain applications. These applications can be built for any private or public industries.
- Provenance: Transparent supply chain networks. Origin and history of products can be traced using this dapp
- Augur: Predict and forecast market events and earn Ethers as a reward.
Where Else Can I Invest?
If you want to channelize your hard earned money and accumulate wealth with minimized risk, mutual funds can be considered as a safe investment.
Mutual funds are an indirect way of investing your money. If investors do not have time and expertise to invest in markets, mutual funds are ideal for your investment. They are managed by professional fund managers who have years of experience in capital markets and investments.
If you are interested in high risk investments, you can look at small-cap funds.
Disclaimer: the views expressed here are those of the author. Mutual funds are subject to market risks. Please read the offer document carefully before investing.